possible intanglement re will

mothers death not expected. will old and not updated. estate in probate. five survivors to divide what's left. before mothers death she, helped one daughter buy and start a business, with a loan of 173 thousand. mother was a partner in business, was being paid off, and drawing paycheck from company. this is in state of alabama. what will be expected of daughter re the business loan in reguards to the estate?
what are the survivors intitled to in this instance according to the law?

Is my question too vague? Not enough info? Boring? Any answer to this? Anybody????

If it was truly a loan, was it to the daughter directly or to her incorporated business?

If the latter as a matter of law the debtor continues to owe the principal back to the estate according to the terms of the loan. The child who is the business' principal owner (and I assume 1/5th beneficiary of the estate) would take her 1/5th share of the estate (including 1/5th of the loan). If the loan was to the daughter, the daughter presumably owes the money to the estate (unless debts were forgiven at death, or to be treated as advances on a bequest, under the Will). If the loan balance exceeded her share of the estate, she as debtor would owe money to the estate, and get nothing.

HOWEVER, this sounds like something different than a normal loan, and either an advance, or an investment in the business with the return to have been (or having become) "salary" for little or no real work. Perhaps the loan should be treated as an equity investment.

Thus this may be a time for a grieving family to try to put aside any petty family jealously and resolve this in a manner that is "fair", rather than purely "legal"; sometimes getting everything purely legal can cost huge dollars, create conflict that breaks a family apart and creates generations of resentment and conflict. As everyone has his or her view as to what may be "fair" (the daughter whose business it is could think forgiving the loan, and still giving her 1/5th of the estate, is fair -- it is not), while one child might say "that was her share, we'll split the rest in 4", and another might say "I want sister to pay the estate back every penny, plus interest, and not credit the salary, even if it sends her to bankruptcy as she shouldn't get more than me".

This is time for the family to turn, as one, to a very good lawyer-mediator and resolve it.

Thank you for your response. I realize that you did not have a lot of info to go on.
Their business is icorporated, but I am not sure if the loan was made directly to the daughter or to the company. I suspect that the loan was made to the daughter and after the company was going, they incorporated. Just got the breakdown of debts and values of the estate, from the exeuctor of the will,(the youngest brother). It's my understanding that the loan was made to my sister and her husband to start up the business. Mother was made partner and was receiving payments on the loan plus was actively working in the business and drawing a salary as well.
Have not been in touch much with these family members, as I and my ,(the oldest),brother were not raised by mother. The will that was found was sadly out of date and not usefull as it was between mother and her husband. He has been 8 years or more deceased and mother as the survivor was the only one mentioned in the will. Everything went to her upon his death. The will was not updated, therefore the court dictated that the 5 children would be the benificiaries of the estate.
I for one am not wringing my hands in greed. My one brother and I live out of state and many miles away from all of this mess. The three raised by mother are another story. The daughter to whom the loan went, has stated that if things get nasty, they will file for bankruptcy. The balance of the loan does indeed exceed her share. They are trying to renegotiate the note on the loan. What that means as far as the estate goes, I'm not sure.....any answer to that?
Would you also clairfy what you ment by treating the loan as an eqity investment? If you have any questions about this situation, please ask.
Your imput will be greatly appreciated. Sorry if this was so long.

Just as I feared, much of the money was lost in the business and the loan balance exceeds the value. It happens.

If it was "equity" or a "partnership" then your mother lost her share too; if it was a pure loan, the sister owes it and the entire value of the business would go to the estate.

While Bankruptcy at this stage may not help sister much, what really counts is getting a mediator involved before all the value is lost in squabbling and legal fees. Get a lawyer.

Thank you again for your response. It has become abundantantly clear that I need to ask some questions of the executor of the will. I would hate to see my sisters business go under because any fighting over this. It is their livelyhood and forcing the issue serves no purpose except to make everyone a looser.
The one sister of the three raised by mother sees $$$$$$ and is the one making the biggest stink.
I do not think I have the whole or true picture as to exactly how the loan was made. I will get some answers to key questions and take your advice about talking to a good lawyer.
I have been told by my sister, that the business is valued,(acessed), at almost twice the loan value as far as what they would ask for in selling the business. She has stated that she is looking to maybe sell the business in two or three years if they are not forced into bankruptcy.
She has also stated that she feels that the loan that mother made to her is owed back to the estate. They simply are not in a position to hand it back because they are still paying on the loan and do not have the funds to just fork out that much money. I also have not seen a P&L statement to give me an idea as to just how healthy their business is.
If I have to ask questions in order to find out exactly where things stand in this situation, what would you suggest I ask? I just want to see that things are done fairly without the greedy grubbing that seems to come with situations like this. If the one sister keeps it up, the only one to benifit will be, as you say, the ones collecting legal fees.
Many thanks, for your advice.